Regulators to decide if app-based Uber must comply with taxi rules

Public Utilities Commission staff says for-hire firm no different than cab companies

May 15, 2013|By Candy Thomson, The Baltimore Sun

The state Public Utilities Commission will schedule a formal hearing on whether to make Uber Technologies, which lets Baltimore customers hail a town car by smart phone, abide by regulations that govern taxi companies.

The app-driven startup company Uber entered the Baltimore market in January, raising the ire of local cab companies that said it was skirting state regulations. Century-old Yellow Cab filed a challenge with the commission, contending that Uber should not be allowed to operate here until it complies with the same safety and insurance regulations as traditional taxi and limo companies.

The panel rejected the complaint in February, but instructed its staff to investigate Uber's operation. The staff's report concluded that Uber should file to become a common carrier, "if it intends to continue to operate in Maryland."

The commission has not set a date for the hearing.

In a 13-page letter, San Francisco-based Uber objected to the finding and urged the commission to reject the report.

Attorney Brian Quinn said Uber is a technology company not a transportation company because it owns no vehicles and does not have drivers. Instead, it provides the tool — an app — that allows customers to contact independent drivers, who sign up to participate and get a cut of the fare.

"Uber does not compete directly with transportation providers," Quinn wrote. "Uber does not hold itself out to the public as having any certificate, license or other authority from the commission authorizing Uber to engage in the transportation of persons for compensation."

The public, he said, no more confuses Uber with a traditional cab or limousine service than Hotwire and OpenTable customers confuse those reservation services with hotels and restaurants.

Uber got its start in 2009 in San Francisco and has attracted more than $40 million from investors, including Goldman Sachs. It has branches in more than a dozen U.S. cities as well as London, Berlin and Paris. The company launched its Washington operation in late 2011.

Drivers for limousine companies and independent drivers with their own luxury cars sign up with Uber. Customers sign up, download the Uber app, set their pickup location and request a ride. Uber uses GPS technology to find the nearest driver for the pickup.

There is no exchange of cash or tip. The entire transaction is processed through the customer's account. Uber charges about double the city's taxi fare schedule but below what it would cost to hire a private car by traditional means.

The Taxicab, Limousine and Paratransit Association, an international trade group based in Rockville, believes Uber is a transportation company because it makes money off the fares, not the app.

The association has labeled Uber a "rogue" service "operating outside of the public's best interests. ... Such apps are a danger to public safety and operate in violation of community standards for taxi and limousine transportation in terms of passenger safety, access, nondiscrimination and regulated fares."